Corporate Governance System

In order to strengthen the audit and supervisory functions of the Board of Directors and further enhance corporate governance, we introduced an executive officer system in May 2016 to separate management decision-making and supervisory functions from business execution functions. In June 2019, Riken Corporation shifted from a "company with a Board of Corporate Auditors" to a "company with an Audit and Supervisory Committee." Its management organizations are based on the Board of Directors and the Audit and Supervisory Committee.

The Board of Directors of Riken Corporation is composed of six Directors (including two outside directors, and excluding directors who are Audit and Supervisory Committee Members) and three Directors (two outside directors) who are Audit and Supervisory Committee Members (as of July 31, 2020). The Board of Directors makes decisions on the matters stipulated by laws and regulations at the regular monthly Board of Directors meeting and the extraordinary Board of Directors meeting held when necessary, as well as important management matters such as the management policies stipulated by the Board of Directors rules, and supervises the execution of business.

The Executive Committee, consisting mainly of executive officers, meets twice a month in principle to discuss various management issues and exercise overall control over business execution in accordance with the basic management policies set by the Board of Directors. In addition, we hold Global Conferences twice a year, which are attended by the directors and executive officers of Riken and executives such as the presidents of overseas affiliates, to promote Riken Group global management.

Riken Audit and Supervisory Committee consists of three members, including two outside directors (as of July 31, 2020). Based on the audit policy established by the Audit and Supervisory Committee, Audit and Supervisory Committee Members audit directors' execution of duties through interviews with executive directors and executive officers on the status of business execution and the cooperation with the Internal Control Department, which is in charge of internal audits.

Accounting audits are conducted by Deloitte Touche Tohmatsu LLC as an accounting auditor.

Furthermore, to promote CSR-related activities, we have established the CSR Committee as a subordinate organ of the Executive Committee. This committee formulates policies concerning CSR, promotes risk management, controls information disclosure, and promotes other CSR activities. We have also established the Compliance Committee to promote activities to reinforce compliance.
In addition, Riken has established the Risk Management Subcommittee and the BCM Subcommittee under the CSR Committee to minimize the risk of losses by, for example, preparing appropriate measures in advance against various risks of loss, and is working to establish and thoroughly implement risk management and business continuity plans.